Tax Provisions to Watch
The infrastructure bill passed by the U.S. Senate would end the Employee Retention Credit early, making wages paid after September 30, 2021 ineligible for the credit (except for wages paid by an eligible recovery start-up business). The IRS issued guidance in Notice 2021-49 for claiming the credit in the third and fourth quarters of 2021. This new tax provision is just one outlined by the Senate Budget Committee on what they would like to see in a fiscal year 2022 budget reconciliation bill. Other provisions include extension of the child tax credit, earned income tax credit, child and dependent care credit, relief from the $10,000 state and local tax deduction cap, and increases in the high-income individual, corporate and international tax rates. These are just provisions and do not reflect current tax law, of course. We will continue to monitor these updates.